How to buy Nordstrom because it yields revenue



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Nordstrom (JWN – Get Report) is an anchor point in a luxury mall that had been collapsing since 2019. The retailer announced a profit after the close on Wednesday, Aug. 21, the stock trading at its lowest level for 10 years. The stock trades around its monthly pivot at $ 26.04 and its semiannual value level at $ 17.79. Basically, the title seems "too cheap to ignore", with a P / E ratio of 7.60 and a dividend yield of 5.85%, according to Macrotrends. Investors willing to "catch a falling knife" are expected to start a long position at the monthly pivot at $ 26.04 and be ready to add to the downside their semiannual value at $ 17.79.

The stock closed Tuesday at $ 25.15, down 46% from the beginning of the year and in bearish territory to 62.9% lower than the 52-week high of $ 67.76 set on 6 November. The stock reached its highest absolute level of $ 77.65 in the week of March 27. , 2015, just as Amazon.com (AMZN – Get Report) began to steal market share with the increase in online shopping.

Anchors in Macy's shopping malls (M – Get Report) is also trading near a 10-year low. J.C. Penney (JCP – Get the Report) trades below the dollar per share and risks delisting. Dillard's (DDS – Get Report) is under pressure but holds better than the other three major anchor points of the mall.

Analysts expect Nordstrom to earn 79 cents a share when it publishes its results after the closing bell on Wednesday, August 21st. The retailer missed its earnings forecast on May 21 and an increase in revenue is expected for the second quarter results. The annual decline in sales seems manageable at 3.4% expected. The surprise could come from the forecast as Nordstrom will open its first flagship site in Manhattan in October, which should be positive for the 2019 holiday shopping season.

The daily chart for Nordstrom

Courtesy of Refinitiv XENITH

The Nordstrom daily chart indicates that the stock is below the "death threshold" since January 9, when the 50-day simple moving average fell below the 200-day moving average, indicating that lower are coming. The action closed the year 2018 at $ 46.61, which was a significant contribution to my proprietary analyzes. The annual risk level remains at the top of the chart at $ 64.11. The closing of $ 31.86 on June 28 was also a contribution to my analyzes. A risky quarterly level is $ 43.11 and a semiannual value of $ 17.79. The July 31 closing of $ 33.11 was an entry in my analyzes and its monthly pivot for August was $ 26.04.

The weekly chart for Nordstrom

Courtesy of Refinitiv XENITH

The weekly chart for Nordstrom is negative but oversold, with the stock below its five-week moving average of $ 29.35. The title is well below its 200-week single-moving average or "return to average" at $ 47.66. The weekly slow stochastic reading of 12x3x3 is expected to rise to 13.34 on August 16th, at 11.36 points. A reading below 10.00 would make the title technically "too cheap to ignore".

Trading strategy: Buy Monthly Pivot at $ 26.04 and add a $ 17.79 Mid-Year Value to the Weakness position. Reduce its holdings to its risky quarterly level, at $ 43.11.

How to use my value levels and risk levels:

Value levels and risk levels are based on the last nine week-end, monthly, quarterly, half-yearly and annual closings. The first set of levels was based on the closure of December 31st. The initial annual level remains in play. The weekly level changes weekly. The monthly level has been changed at the end of each month, the last one as of July 31st. The quarterly level was changed at the end of June. My theory is that nine years of volatility between fences is enough to assume that all possible bullish or bearish events of the security are taken into account. To capture the volatility of stock prices, investors should buy at a low level and reduce their risky assets. level. A pivot is a level of value or a level of risk that has been violated in its time horizon. The pivots act as magnets that have a high probability of being retested before the expiration of its time horizon.

How to use weekly slow stochastic readings 12x3x3:

My choice to use weekly 12x3x3 slow stochastic readings was based on testing upstream of many methods of reading stock price dynamics in order to find the combination that gave the least false signals. That's what I did after the stock market crash of 1987. So I'm happy with the results for over 30 years. Stochastic reading covers the last 12 weeks of high, low and closed for the stock. There is a rough calculation of the differences between the highest high and the lowest low relative to the fence. These levels are changed for fast playback and slow playback and I found that slow playback worked better. Stochastic readings are between 00:00 and 100:00, readings above 80.00 are considered overbought and readings below 20.00 are considered overworked. Recently, I've noticed that stocks tend to peak and fall from 10% to 20% and faster after reading above 90.00. That's what I call a "swelling parabolic bubble" when a bubble always pops up. I also call a reading below 10.00 as being "too cheap to ignore".

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